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ACCOUNTING PRINCIPLES
Management 1A
Julie Ann Gardner-Treloar, Lecturer
FALL 2014

OFFICE: MBA North D405 OFFICE HOURS: T/Th 9:00 am 9:30 am, 12:15 1:00 pm

IMPACTED CLASS: This is an impacted class. Any drop after the second week, if approved, will
result in a W on the students transcript.
REQUIRED RESOURCES:
The following item is available in the Ackerman Bookstore:
1. Fundamental Accounting Principles, Wild, Shaw, and Chiappetta, 21
th
edition (earlier editions
are not acceptable)

The following items are available at Course Reader Material, 1081 Westwood Blvd:
2. Course Lecture Notes
3. Sterling Computer Services (Assignment #2)

Homework solutions are available on the course website for the 21
st
edition. The website is
accessible to all students enrolled in the course via the students MyUCLA account.

OBJECTIVE:
The objective of this course is to introduce financial accounting. Initially, the student will be introduced
to the four basic financial statements, including the income statement, the statement of owners equity, the
balance sheet and the statement of cash flows. The student will learn how to prepare these financial
statements. The student will then learn how to record business transactions using journals and ledgers.
The course will focus on the specific issues associated with recording transactions with respect to the asset
side of the balance sheet, as well as the current liability section. (Non-current liabilities and equity are
covered in Mgmt 1B). Generally accepted accounting principles, as well as accounting assumptions will
be emphasized throughout the course.

The student will be introduced to the concept of financial statement analysis. This will be accomplished
with several assignments that will require the student to analyze the financial statements of publicly traded
companies. The student will also be introduced to a number of career options, which require a strong
foundation in financial accounting.

The Teaching Assistants for Management 1A and 1B are SPONSORED BY:

Deloitte

EY

KPMG

PWC

Moss Adams

Section times and dates will be determined during the first week of classes, after the MBA TAs have
finalized their schedules.
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GRADING: Midterm 35%
Final 45%
Assignment #1 7%
Assignment #2 Required to pass the course
Assignment #3 6%
Assignment #4 6%
Assignment #5 1%

NO GRAPHING CALCULATORS ARE PERMITED FOR EXAMS.
ONLY A BASIC 4-FUNCTION CALCULATOR IS ALLOWED
MAKE-UP EXAMS WILL NOT BE GIVEN.
NO LATE ASSIGNMENTS WILL BE ACCEPTED! NO EXCEPTIONS WILL BE ALLOWED.

ASSIGNMENT #1: DUE OCT 21
Assignment #1 will require the student to obtain and read information from the financial statements of a
publicly traded company. It will require you to review both the Annual Report at the companys web site
and the 10k filed with the SEC at the SECs web site. This assignment will be emailed to the class.

ASSIGNMENT #2: DUE NOV 6
Completion of assignment #2 will significantly improve the student's understanding of the accounting
process by walking you through the transactions at a small company, and by requiring you to prepare
year-end financial statements. An incomplete or incorrect accounting case study will have a significant
adverse impact on your grade. This assignment must be completed to pass the class.

ASSIGNMENT #3: FINANCIAL STATEMENT ANALYSIS: DUE NOV 20
You will need to form groups of 8 people (no more, no less). Your group will then select an industry
sector. Each member will obtain financial statements from one company in the sector. Each student will
calculate the financial ratios for the company they selected. The student will then write a 2 page
quantitative and qualitative analysis of the company, including a discussion of the financial ratios, the
financial statements and current news articles that might affect an investors decision to buy or sell the
stock. See page 4 of the Course Reader for an expanded discussion.

ASSIGNMENT #4: FINANCIAL STATEMENT ANALYSIS - GROUP PROJECT: DUE DEC 2
The groups formed as described above should prepare a spreadsheet summarizing all 8 companies
financial ratios. The group will discuss the 8 companies in the sector and determine which company
would be the best investment choice in the sector. A report summarizing the groups results will then be
turned in. The report should not exceed 2 pages. See page 5 of Course Reader. English use, grammar
and spelling will be considered in the grade, as well as technical and financial accuracy and the
reasonableness of the recommendations. You will also evaluate the performance of each of your group
members. See the last page of the Course Reader for the group evaluation form.

ASSIGNMENT #5: ROTH IRA: DUE DEC 9
You will need to turn in an application for a Roth IRA. You can obtain this from any mutual fund
company or any brokerage firm.

INSTRUCTOR:
Julie Ann Gardner Treloar is a licensed C.P.A. in the State of California. She has taught undergraduate
courses in Beginning and Intermediate Accounting, Auditing, Managerial Accounting, Individual
Taxation and Corporate and Partnership Taxation, Audit and Fraud Examination and Ethical Leadership in
Accounting. She is also a tax and financial planner. Her education includes an MBA from the Anderson
School at UCLA, a Masters in Business Taxation (MBT) from the Leventhal School of Accounting at
USC, a Certified Financial Planner (CFP) Certificate from UCI, a B.S. in Aerospace Engineering from Cal
Poly, Pomona and an A.S. in Airframe and Aircraft Powerplant Maintenance Technology from Mt. San
Antonio College.
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Week Class Reading Homework Problems
0 1 Chapter 1
Accounting in Business
QS 1-7, 1-10, 1-11, 1-12
E 1-8, 1-11, 1-14, 1-15, 1-16, 1-19
QS = Quick Study, E = Exercise, P = Problem, BTN = Beyond the
Numbers
1 1 Chapter 1 P 1-1A, 1-2A, 1-10A
BTN 1-2
1 2 Chapter 2
Analyzing and Recording
Transactions
QS 2-3, 2-4, 2-6
E 2-9, 2-11, P 2-1A, 2-2A, 2-3A
BTN 2-1, 2-2
2 1 Chapter 3
Adjusting Accounts and Preparing
Financial Statements
E 3-2, 3-3, 3-4, 3-6, 3-7, 3-9
P 3-3A, 3-4A, 3-3B
BTN 3-1, 3-2
2 2 Chapter 4
Completing the Accounting Cycle
E 4-1, 4-4, 4-5, 4-9, 4-10, 4-11, 4-12
P 4-4A, 4-5A, 4-6A
BTN 4-1, 4-2
3 1 Chapter 7
Accounting Information Systems
E 7-1, 7-2, 7-3, 7-6, 7-10

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&
4
2
&
1
Chapter 7 BRING ACCOUNTING CASE STUDY (Assignment #2) TO
CLASS
Work on Accounting Case Study for Homework
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&
5
2
&
1
Chapter 5
Accounting for Merchandising
Operations
QS 5-3, 5-4, 5-8
E 5-2, 5-3, 5-4, 5-13, 5-14, 5-15
P5-1A, 5-4A (1-3)
BTN 5-2, 5-9
5 2 Chapter 8
Cash and Internal Controls
QS 8-1, 8-4, 8-5, 8-6, 8-8
E 8-5, 8-6, 8-7, 8-9
P 8-1A, 8-4A
BTN 8-1 (1-3), 8-2
6 1 No Class Veterans Day
6 2 MIDTERM ON THURSDAY,
NOV 13,
6:00 PM 7:20 PM
Midterm on Chapters 1-5 AND 7, 8
7 1 Chapter 9
Accounting for Receivables
QS 9-3, 9-4, 9-5, 9-6

7 2 Chapter 9


E 9-3, 9-4, 9-5, 9-6, 9-8, 9-9, 9-11
P9-2A, 9-4A BTN 9-1 (1-5), 9-2
8 1 Chapter 6, Appendix 6A
Inventories and Cost of Sales
QS 6-1, 6-2, 6-3, 6-8, 6-9, 6-10, 6-11, 6-12, 6-13, 6-14
E 6-3, 6-4, 6-5, 6-12, 6-14, 6-16, 6-17
P 6-1A, 6-7A, 6-8A
BTN 6-1, 6-2
8 2 HAPPY THANKSGIVING!
9 1 Chapter 15
Investments and International
Operations
QS 15-4, 15-6, 15-7, 15-8, 15-9, 15-10
E 15-1, 15-2, 15-3, 15-8, 15-9, 15-11
P 15-1A
BTN 15-2
9 2 Chapter 10
Plant Assets, Natural Resources,
and Intangibles
QS 10-2, 10-3, 10-4, 10-5, 10-6, 10-9, 10-10, 10-12
E 10-6, 10-7, 10-8, 10-11, 10-15, 10-18, 10-19
10 1 Chapter 10

P 10-6A
BTN 10-2
10 2 Chapter 11
Current Liabilities and Payroll
Accounting
QS 11-3, 11-4, 11-6, 11-7, 11-10
E 11-6, 11-7, 11-9
P 11-4A
BTN 11-2
Final
Tuesday, December 16,
6:30 PM - 8:30 PM
FINAL on Chapter 6, 9 - 11, Stocks and Bonds from Chapter 15,
Financial Ratios, and IRA Chart

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INTRODUCTION TO FINANCIAL ACCOUNTING

I. What is Accounting? The language of business

A process of identifying, recording and communicating the economic events of an organization to interested
users of the information.








II. Who are the users of financial information?

A. Managerial Accounting serves internal decision makers


Internal users:
Marketing managers
Production supervisors
Finance directors
Company officers

B. Financial Accounting serves external decision makers

External users:
Investors
Creditors
Taxing authorities
Regulatory agencies
Customers
Labor unions

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III. How are Publicly Traded Companies Regulated?

A. Securities and Exchange Commission (SEC)
An agency of the U.S. government that was established in 1933 to administer laws and regulations
relating to the exchange of securities and the publication of financial information by U.S.
businesses.

1. Securities Act of 1933

a. Registration Statement


2. Securities Exchange Act of 1934

a. 10K

b. 10Q

c. 8K - is a current report companies must file with the SEC to announce major events that
shareholders should know about. For example, Completion of Acquisition, Bankruptcy,
Changes in Registrant's Certifying Accountant

3. Sarbanes-Oxley Act of 2002

a. PCAOB - Public Company Accounting Oversight Board

4. Database of SEC filings:

Web site: www.sec.gov
EDGAR - Electronic Data Gathering, Analysis, and Retrieval system


B. Financial Accounting Standards Board (FASB)
An organization with the responsibility for developing accounting principles in the U.S.

1. Generally Accepted Accounting Principles (GAAP)
The established set of standards and rules that are recognized as a general guide for financial reporting
purposes, which have been established by the accounting profession.

2. International Financial Reporting Standards (IFRS)
(Established by the International Accounting Standards Board (IASB))



C. Public Accounting Firms

1. Generally Accepted Auditing Standards (GAAS)
The established set of standards and rules that are recognized as a general guide for performing
audits of financial statements, which have been established by the accounting profession.

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IV. Forms of Business Organizations and Types of Business Activities



A. Forms of Business Organizations

Sole proprietorship

Partnership

Corporation



B. Types of Business Activities

Service

Merchandising

Manufacturing



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V. Basic Accounting Information

A. Basic Information
























B. Basic Financial Statements:

1.


2.


3.


4.


5.

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VI. Basic Accounting Equation


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Double entry bookkeeping
Summarized in a writing in 1494, by Fra Luca Bartolomeo de Pacioli
(1445 1517) He was an Italian mathematician, Franciscan friar, collaborator with Leonardo da Vinci and
seminal contributor to the field now known as accounting.
Pacioli published several works on mathematics, including: Summa de arithmetica, geometria, proportioni et
proportionalit (Venice 1494), a textbook for use in the schools of Northern Italy. It was a synthesis of the mathematical knowledge
of his time and contained the first printed work on algebra written in the vernacular (i.e. the spoken language of the day). It is also
notable for including the first published description of the method of bookkeeping that Venetian merchants used during the Italian
Renaissance, known as the double-entry accounting system. The system he published included most of the accounting cycle as
we know it today. He described the use of journals and ledgers, and warned that a person should not go to sleep at night until the
debits equaled the credits. His ledger had accounts for assets (including receivables and inventories), liabilities, capital, income,
and expenses the account categories that are reported on an organization's balance sheet and income statement, respectively.
He demonstrated year-end closing entries and proposed that a trial balance be used to prove a balanced ledger. He is widely
considered the "Father of Accounting".
(Source: http://en.wikipedia.org/wiki/Luca_Pacioli)

From the Latin
debere = debit, abbreviated DR
credere = credit, abbreviated CR

Debit may signify:

Increase in asset account

Decrease in liability account

Decrease in equity account

Credit may signify:

Decrease in asset account

Increase in liability account

Increase in equity account


Type of Account Increase Decrease Normal balance

Asset

Liability

Equity:

Contributed Capital

Retained Earnings

Revenue

Expense

Dividends/Drawings